Electronic Arts is reportedly in advanced talks with private investors, including Saudi Arabia’s Public Investment Fund (PIF) and Silver Lake, to return the company to private. According to a recent report by the Wall Street Journal, the proposed buyout deal is worth $50 billion. A successful deal could be announced as early as next week.
“Discussions on price are still underway, but the deal could value EA at as much as $50 billion,” explained the WSJ. In 2023, the PIF purchased a 10% stake in the company, while Silver Lake and Affinity Partners, formed in 2021 by President Donald Trump’s son-in-law Jared Kushner, currently don’t own a stake in the company.
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Electronic Arts’ shares were worth around $43 billion before the news of the buyout was made public. However, after the publication, the company’s shares rose nearly 15%, pushing its market value to around $48 billion.
If the buyout succeeds, the WSJ believes it would become the “largest leveraged buyout ever, not adjusting for inflation”. The current buyout that holds that record was the $32 billion sale of TXU in 2007.
At the time of the WSJ publication, neither Electronic Arts, Silver Lake, nor PIF had publicly commented on the matter. Should the buyout succeed, it will also increase the influence of PIF in gaming. EA has a strong games portfolio, including the EA Sports FC series and Battlefield.
According to reports, Saudi Crown Prince Mohammed bin Salman instituted the PIF with the main goal of making the Saudi economy less reliant on oil revenue. PIF has since invested in several emerging technologies, including electric vehicles. The company owns billions of shares in Take-Two and Nintendo.
Speaking to Reuters on the matter, games professor at NYU Stern School of Business, Joost van Dreunen said, “For Saudi Arabia’s PIF, the deal would cement games as cultural infrastructure — assets as critical to global influence as sports or film”.
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